Compound annual return for single family homes in the three decades through 2013
Compound annual return for the S&P 500 stock index in the three decades through 2013
For most people, it makes sense to invest in financial assets like stocks and bonds, and also invest in real estate through home ownership, or perhaps an interest in a rental property. The two types of assets move according to very different business cycles, so it may make sense to combine both in your portfolio.
Data source: Freddie Mac for home data, Morningstar for S&P 500 data, as reported in the Wall Street Journal